The Association of Professional Pension Trustees (APPT) has written to the new Pension Minister, Emma Reynolds, to outline a 'shopping list' of areas trustees are looking forward to action in, urging the government to address some key issues in the governance space.

In the letter, the APPT welcomed the "important" early measures announced in The King’s Speech and the Pension Schemes Bill.

In particular, the group said that the measures regarding investment allocation, consolidating small pots, ensuring value for money, and requiring trustees to offer appropriate retirement products are of huge “importance” to trustees and APPT members.

APPT chair, Harus Rai, said: “Given our fiduciary duty to act in the best interests of the beneficiaries of pension schemes, as professional trustees, we hold somewhat different duties from those that preoccupy other bodies active in the pensions sector.

“We are looking forward to meeting the new minister to underline some of the key issues that need addressing in the governance space and that we find are of concern to both trustees and scheme members.”

Indeed, the APPT's letter set out a list of areas where trustees are looking forward to action and a "healthy dialogue" with the minister’s team in the weeks ahead.

In particular, in the defined contribution (DC) space, the APPT said that trustee boards and members are looking for the government to take more action beyond dashboard and value for money reforms.

It also said that the association wanted the government to encourage higher minimum pension contributions and progress wider risk-sharing reforms like collective defined contribution (CDC), which could lead to better pension outcomes.

The group also highlighted the need for greater clarity in the defined benefit (DB) space, noting that the delay in launching the DB Funding Code and covenant guidance has been causing frustration and concern.

Given this, it argued that early action is needed so trustees and sponsoring employers have adequate time to meet scheme funding requirements set by regulations.

The APPT also encouraged the new minister to work with the Economic Secretary to ensure HM Revenue and Customs (HMRC) quickly resolves regulatory gaps, and allow schemes to progress many members’ outstanding lifetime allowance (LTA) tax queries.

In addition to this, the APPT noted that trustees are concerned about the outcome of the Virgin Media case, which could require schemes to spend a lot of time and create a high cost to investigate past amendments that have little or no benefit to most members and could harm sponsoring employers.

The association therefore encouraged the Department for Work and Pensions (DWP) to take early regulatory action to resolve this issue.

The letter also said that, given trustees’ fiduciary duties, there needs to be a significant financial incentive to encourage more investment in UK assets, suggesting that this should be considered by the minister’s Treasury colleagues ahead of the next Budget.

The APPT also said it wants the government to continue to enhance schemes’ governance, including making it mandatory to appoint accredited professional trustees to scheme governance bodies.

The letter noted that APPT members and trustees are also interested in hearing more about the government’s plans for climate transition requirements related to scheme investments.

However, in terms of surplus, the association warned that recent proposals for the sharing surplus in DB schemes, need "very careful" handling to avoid putting trustees and possibly members in a "very difficult" position.

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